Saturday, April 05, 2008

CP Huntington Loses Control

From: kylewyatt@aol.com

I was reading in the biography of Henry Edwards Huntington by James Thorpe [University of California Press, Berkeley, 1994] – in particular the section where Henry is in California as Collis' representative in the 1890s. One thing I found particularly interesting was the leadup to Collis' death, which set the scene for Henry losing out in becoming President of the Southern Pacific. In 1898-99 Collis was maneuvering the buyout of the interests of the Crockers, Stanfords, and finally the Hopkins/Searls interests. Huntington acquired some, but his bankers, Speyer & Company, also acquired a lot. Out of this in late 1899 the Southern Pacific Company board was reorganized with all SP officials except CP and Henry removed and replaced with Speyer representatives. Reading between the lines, I think CP blew it right there. In his enthusiasm to get rid of the Crocker, Stanford and Hopkins/Searls interests, he allowed his bankers to gain a major interest. Even before his death they were already dictating some actions. And while CP may have had the strength of position to be able to push back, Henry certainly didn't, which explains maybe why he lost out.

Unfortunately, so far I haven't found any more about those events in other books. But it appears to be an interesting topic to explore further. What I don't yet have a handle on is how the whole reorganization of the Central Pacific at that time in order to pay off the Federal debt factors in to the buyout of the other interests. I suspect it is an important piece of the puzzle, but I've only just skimmed briefly so far. Lots more to integrate.

—Kyle